Pharmacoeconomic series: Part I. Pharmacoeconomics and the evaluation of drugs and services.

The field of pharmacoeconomics is of growing interest to everyone from government policy makers to medical staff and administrators at hospitals and other managed care settings. This article reviews basic terminology and methodologic issues related to using pharmacoeconomics to evaluate drugs and services. Economic evaluation tools such as cost-benefit analysis, cost-effectiveness analysis, cost-utility analysis, and cost-minimization analysis are described. The challenge for all clinicians is to use these economic evaluation tools to optimize the benefit-to-cost ratio and resultant positive outcome of programs, services, treatments, or other interventions for the patient, the institution, and society.